We have recently demonstrated that chronic inhibition of the Transforming Growth Factor- (TGF) signaling pathway by a small molecule TGFR1 inhibitor in vivo leads to the outgrowth of drug resistant chemically-initiated carcinomas in a mouse skin cancer model. This is the first report of development of acquired drug resistance to a TGF inhibitor. Moreover, these drug resistant carcinomas have an aggressive phenotype and show gene enrichment for expression of skin stem cell markers. The goal of the current proposal is to determine whether this molecular profile, indicative of a cancer stem cell, is due to expansion of the functional stem cell compartment, and to elucidate the molecular mechanisms for acquisition of drug resistance. The hypothesis to be tested is that chronic pharmacological suppression of the TGF signaling pathway induces a drug-resistant state resulting in constitutively elevated Smad2/3 signaling that supports expansion of the CSC compartment. In Aim 1 we plan to prove this hypothesis using both in vivo and in vitro approaches in the mouse skin model of chemically-induced carcinogenesis. In Aim 2, we will address the molecular mechanisms responsible for acquired drug resistance and CSC outgrowth by mutation screening of archival tissue using ultra-deep sequencing of the exons of target genes, and by undertaking screens for Smad2 activating kinases in vitro. Understanding the molecular mechanisms of acquired drug resistance to TGF blocking therapies has the potential to improve treatment strategies and next generation drug design. In addition, because of the intimate association between CSCs and TGF signaling, this knowledge has great promise to provide insights into the molecular regulation of CSC maintenance and could provide novel druggable targets for attacking CSCs.